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Medicaid 2.

The Republicans are willing to try to address the “entitlement tidal wave” headed toward the economy.[1] Naturally, their first effort targets the low-hanging fruit of the poorest Americans. Who don’t usually vote Republican.

Their first target is Medicaid. Medicaid works as a partnership between the federal government and state governments. Medicaid pays whatever bills are presented by care-providers. The Republican American Health Care Act (AHCA), the intended successor to the Affordable Care Act (ACA) intends to cut the federal contribution to Medicaid. Non-partisan experts agree that the intent of the plan is to cut federal spending on Medicaid over the long term. States would not, in all likelihood, make up most of the cuts to federal spending by increasing state spending and—to pay for it—state taxation.

Critics of the current operation of Medicaid point out that a willingness to pay any bill that is submitted just entrenches an inefficient current system.

The much admired Congressional Budget Office (CBO) estimates that the Republican plan would cut Medicaid spending by $80 billion a year for a decade.

To return to a previous post, those with disabilities, poor mothers, and about two-thirds of those in nursing homes have their costs paid by Medicaid. This was Medicaid before the ACA expansion of coverage. That expansion of coverage added many poorer Americans beyond these core categories.

Reportedly, the Republican bill (AHCA) will cap payments to each person covered by Medicaid, with a controlled rise in payments over time. However, there is no guarantee that states will make up the difference if health care costs rise faster than the Republican projection.

Critics point out that necessary medical spending varies over the years, rather than sticking to the Republican projection. If Zika reaches the United States (never mind Ebola), then spending could spike well above the projections.

At the center of the dispute is the question of who will pay if Medicaid spending is capped or reduced. Will spending caps force doctors to cut their rates?[2] That is the Republican bet, just as they blame rising college costs on the growth of financial aid. Or will spending caps lead doctors and hospitals and insurance companies to dump their least profitable patients? One factor missed in this crude debate is that the first to be cut will be the able-bodied workers added to the Medicaid rolls by the ACA. If that happens it may never come to cutting nursing home funding.

Again, the press provides too little information to evaluate the program on its merits. It seems absurd that the United States is the only advanced industrial country that allows the greed of doctors to dictate medical costs. That seems to me a “social wrong.” It seems absurd that ne’er-do-wells should send in their medical bills to the tax-payers. Again, a “social wrong.” On the other hand, it seems absurd that the United States is the only advanced industrial country without universal health care. Such access seems to me a “social right.”

To think about these issues is to confront a basic question. What role should the state play in providing medical care to the poorest Americans? What role should be assigned to self-reliance?

[2] Apparently, American doctors make 50 percent more than their comparably-skilled Western European or Japanese confreres. Did I ever tell you about my son’s urologist whose computer screen background was a picture of a 40 foot sailboat with the text “Sail the boat”?